New Missouri Law Pays Dividends for Kansas City Care Clinic

Thanks to a change in Missouri law

By Mike Sherry for the Hale Center of Journalism

July 25, 2014

A year and a half ago, a local safety-net clinic underwent one of the most significant changes in its more than four decades of serving the metropolitan area: It went from a purely free provider to one that also accepted paying patients covered by insurance.

Known for years as the Kansas City Free Health Clinic, the organization became the Kansas City CARE Clinic to reflect that its donation-based operation had evolved to a fee-based, sliding-scale system with a minimum payment of $10.

The shift promised hundreds of thousands of dollars in new revenue for the clinic, at 3515 Broadway in Kansas City, Mo., but lawmakers first needed to fix a glitch in a state statute. That finally occurred last week when Missouri Gov. Jay Nixon signed legislation shepherded through the General Assembly by State Sen. Jolie Justus, a Kansas City Democrat.

“We are just thrilled that Jolie was able to get this through the Legislature and that the governor signed it, so we can move forward and make sure that we can continue to serve people in need in the Kansas City region,” says Kansas City CARE CEO Sheri Wood,

Roots in Westport
Established in 1971 as the Westport Free Health Clinic, the clinic now handles about 19,000 patient visits per year. In addition to general medical services, such as physicals and well-women care, the clinic is one of the largest local providers of services to HIV patients.

The shift in operations at the clinic came in response to the 2010 enactment of the federal Affordable Care Act, also known as Obamacare.

Through federal subsidies, the act aims to help uninsured patients find affordable health coverage. The law also anticipated that more low-income residents would get medical coverage through Medicaid, though Missouri and Kansas are not among the states that have expanded Medicaid eligibility as the law envisioned.

KC CARE shed its status as a free clinic once some of its patients had a payment source. For example, Wood says, ACA-subsidized insurance policies helped roughly double — to about 60 percent — the number of the clinic’s HIV patients who have insurance. Wood also says the clinic’s transformation should pave the way for former patients to return to the clinic if they had previously been forced to go elsewhere once they became insured.

With about $9 million in annual revenue, excluding contributed goods and services, clinic officials estimate patient payments could conservatively boost annual revenue by about 6 percent. Wood stresses that philanthropy will remain an important component of the clinic’s budget.

Language barrier
But in making the change, the clinic ran afoul of Missouri’s $7.7 million State Legal Expense Fund, which helps cover legal judgments against the retired physicians who provide much needed volunteer help at the clinic. The fund also covers various public service professionals, including members of the Missouri National Guard and some judicial employees.

The section of the statute covering medical providers at nonprofit community health centers defined a free health clinic as one that provides services “without charge.”

Justus’s legislation removed the reference to a free health clinic – substituting “community health clinic” – and removed the “without charge” requirement. The bill excluded federally funded community health centers and rural health clinics from the organizations that are eligible to receive payment of a claim from the fund.

Wood expects to begin billing in September.

She says the additional revenue from insured patients will help the clinic cover increased operating costs, including the implementation of an electronic medical record system.

“But the bigger issue is capacity,” she says.

Clinics like KC Care, Wood says, will play an important role in serving the anticipated surge of new patients coming into the system now that they are insured.

The clinic’s increased operating expenses include a second staff physician and a full-time nurse practitioner hired to handle increased demand for services.

Beyond Kansas City
The change in the state statute will have an impact beyond Kansas City, says Linda Judah, executive director of the Social Welfare Board in St. Joseph, Mo., and president of the Missouri Association of Free Clinics.

“The legislative fix is an exciting advancement for free and charitable clinics to continue to provide relevant safety net services in a fast changing health care environment,” she wrote in an e-mail.

For her part, Justus was thrilled to help an organization that she has supported in the past as a volunteer. She is an attorney and serves as the director of pro bono services at the law firm of Shook, Hardy & Bacon.

So much of what happens in the General Assembly, Justus says, involves fixes that take a long time to bear fruit or are nearly invisible because they are buried in the bureaucracy. This legislative fix promises to have immediate benefits.

“That’s why I ran for office in the first place – to help solve these problem Kansas Citians run into — and we did it this year,” Justus says. “And when everything else seems to be going wrong in Jefferson City, and something like this goes right, it’s just a great feeling.”